Binance Listing Drives Ethena’s ENA to 7-Month High, Boosting Buyback Expectations

Ethena’s ENA Surges to 7-Month High as Binance USDe Listing Sparks $500M Buyback Optimism

Ethena’s governance token, ENA, climbed to its strongest level since late January on Tuesday, as the DeFi protocol moves closer to activating a fee switch that will share protocol revenues with token holders.

ENA rose to $0.87 in early trading, up 8.3% over the past 24 hours and more than 20% over the week, according to CoinDesk data. The rally follows Binance’s announcement that it will list Ethena’s $13 billion yield-generating token, USDe, on its platform starting Wednesday.

Listing USDe on major exchanges is a critical step for Ethena to enable the fee switch mechanism, allowing profits to flow to ENA holders. The protocol recorded $54 million in revenue last month and more than $480 million since its launch in late 2023, according to Token Terminal.

“With the Binance USDe listing, the ENA fee switch is going to get turned on. That unlocks $500 million of buybacks,” said Arthur Hayes, BitMEX co-founder and a prominent Ethena investor.

Recent Catalysts Driving Ethena

Ethena’s momentum extends beyond the Binance listing. USDe’s market capitalization has jumped from $5.5 billion in mid-July to nearly $13 billion, as investors chase yield. Marketed as a “synthetic dollar,” USDe is backed by Bitcoin (BTC), Ether (ETH), and Solana (SOL), paired with an equal value of short perpetual futures positions.

The strategy generates revenue from derivative-backed assets when perpetual funding rates are positive, passing a portion of income to USDe holders as yield. The token currently offers a 6.5% annualized return for stakers, higher than traditional money market funds and DeFi lending rates on platforms like Aave.

Ethena is also tapping into the growing digital asset treasury trend. StablecoinX and TLGY, two firms preparing for a Nasdaq listing, recently raised $530 million to accumulate ENA tokens as a public investment vehicle.

Additionally, the protocol is expanding in the stablecoin space. It is launching a native stablecoin for Ethereum scaling network MegaETH and has hinted at participating in the upcoming stablecoin from derivatives exchange Hyperliquid.